J J Traders vs. The Deputy State Tax Officer

Facts

The petitioner, J.J. Traders, filed two writ petitions challenging orders passed by the Deputy State Tax Officer and the State Tax Officer. In W.P.(MD) No. 22791 of 2025, the petitioner challenged an order dated 08.10.2024 and a subsequent rectification order dated 26.05.2025, pertaining to the tax period 2020-21. In W.P.(MD) No. 22792 of 2025, the petitioner challenged an order dated 29.04.2024 and a subsequent rectification order dated 30.05.2025, for the tax period 2018-19. These orders were passed pursuant to notices in DRC-01 dated 13.12.2023 and 04.12.2023, respectively. The petitioner had also filed applications for rectification under Section 161 of the GST enactments, which were rejected. The petitioner stated that 40% of the disputed tax for the 2018-19 demand had been recovered.

Held

The Court quashed the impugned assessment orders and the rectification orders for both tax periods. The Court remitted the cases back to the Deputy State Tax Officer to pass fresh orders on merits. This decision was made subject to the petitioner depositing 25% of the disputed tax for the demand confirmed by the order dated 08.10.2024 (for the tax period 2020-21) within thirty days of receiving the order. Additionally, the petitioner was directed to file replies to the DRC-01 notices, treating the impugned orders as addendums, within thirty days. If these conditions were met, the Deputy State Tax Officer was to pass fresh orders expeditiously, preferably within three months, after hearing the petitioner. Failure to comply would allow the respondents to proceed as if the writ petitions were dismissed. The Court followed its consistent view in similar circumstances. No issue was expressly left undecided.

Key Issues

1. Whether the impugned orders passed by the respondents are without jurisdiction and in clear violation of statutory provisions, warranting quashing? (Question of law) Petitioner's contention: The petitioner argued that the impugned orders were passed without jurisdiction and in violation of statutory provisions. The petitioner also highlighted that applications for rectification under Section 161 of the GST enactments were rejected. The petitioner further submitted that 40% of the disputed tax for the 2018-19 demand had already been recovered. Revenue's contention: The judgment records no specific arguments from the revenue or state respondents. However, they were represented by the Additional Government Pleader.